Fired Officer Is Suing Wal-Mart
Date of publication: July 1, 2005
Source: The New York Times
By STEVEN GREENHOUSE
A former Wal-Mart executive responsible for inspecting apparel factories in Central America has sued the company, accusing it of firing him for being too aggressive about finding workplace violations, like locked exits and mandatory 24-hour shifts.
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Rollin A. Riggs for The New York Times
James Lynn sued Wal-Mart, contending he was fired for reporting labor abuses in factories abroad.
The executive, James W. Lynn, said he upset Wal-Mart officials by complaining vigorously about apparel contractors that fired pregnant workers and about one company official who, according to several inspectors, was corrupt and treated substandard factories leniently.
In a lawsuit filed two weeks ago in state court in Arkansas, where Wal-Mart Stores is based and Mr. Lynn lives, he asserted that he was terminated in 2002 "for truthfully reporting the abysmal working conditions in Central American factories utilized by Wal-Mart and for refusing to comply with Wal-Mart's demand that he certify factories in order to get Wal-Mart's goods to market."
Wal-Mart officials said Mr. Lynn was not fired for being a forceful monitor, but for violating rules against fraternization.
"This is not a whistle-blower case," said Mona Williams, Wal-Mart's vice president for communications. "It's not unusual for terminated associates at Wal-Mart or anywhere else to claim that they were fired for reasons other than the real misconduct."
Acknowledging that it sent a company security official to spy on Mr. Lynn, Wal-Mart asserted that Mr. Lynn had fraternized with a female subordinate who occasionally traveled with him to visit factories in Honduras and Guatemala.
According to an internal report disclosed by Wal-Mart, the security official kept tabs on the exact time that Mr. Lynn entered and left his subordinate's hotel room one evening in Guatemala.
"Mr. Lynn was terminated for having inappropriate contact with a woman who directly reported to him," Ms. Williams said. "We investigated this, and when we presented it to him, both he and his subordinate admitted it. Both were fired."
Ms. Williams added that "it simply makes no sense to say we fired him for doing exactly what we sent him to Central America to do."
"We are the first to admit that we need to improve conditions in many of our factories, and we expected Mr. Lynn to play a big role in doing just that."
Wal-Mart officials said they have a sophisticated worldwide factory certification program that conducted 12,500 inspections last year. The inspections are intended to prevent improper conditions at the 7,600 overseas factories that supply its stores.
As a global services manager for Wal-Mart, Mr. Lynn was based in Costa Rica and responsible for easing shipments and inspecting factories for workplace violations and product quality.
He said that he knew his days were numbered at Wal-Mart when his superiors criticized him immediately after he told Michael T. Duke, then a Wal-Mart executive vice president and now the president of the Wal-Mart Stores division, that the company's monitoring program deserved a D-plus or C-minus.
In his lawsuit, Mr. Lynn asserts that "the factory certification process was designed only to create the impression that Wal-Mart was producing its goods under humane working conditions when, in fact, working conditions at the factories were terrible and violated the rules and regulations of Wal-Mart."
Mr. Lynn worked for Wal-Mart from 1993 to 2002, first managing a team of 60 workers at a Wal-Mart distribution center in Arkansas and then becoming a trainer and troubleshooter for distribution centers.
He is suing Wal-Mart for wrongful discharge, libel, invasion of privacy and intentional infliction of emotional distress.
In a telephone interview from his home in Arkansas, Mr. Lynn said Wal-Mart undermined its inspections by requiring monitors to give notice before visiting factories.
Several of his monitoring reports noted that factories in Honduras padlocked exits, lacked drinking water, did not have toilet paper and did not pay overtime to some employees. He said some factories were so hot that people passed out and that several gave pregnancy tests to newly hired women, dismissing those found to be pregnant. Such tests and firings would violate Wal-Mart's rules.
Shane Youtz, Mr. Lynn's lawyer, said, "He was fired because he came down so hard on their factories, and the fraternization allegations were just an excuse to get rid of him."
Officials at Wal-Mart said they had the world's largest monitoring program, with 200 full-time inspectors visiting 50 factories daily. These officials said that when inspectors found violations, they gave factories several months to fix any problems before a reinspection.
Last year, according to Wal-Mart's new ethical standards report, the company cut off 1,200 factories for at least 90 days because serious violations were found on two separate visits. Another 108 factories were permanently banned because of child-labor violations.
Beth Keck, a Wal-Mart spokeswoman, gave details showing that several factories criticized by Mr. Lynn had fixed their problems. She said that the factories were reinspected and that Wal-Mart was doing many more inspections without notice.
Mr. Lynn said he did not know whether violations continued at the factories he inspected. But Charles Kernaghan, director of the National Labor Committee, a worker rights group that frequently criticizes Wal-Mart, said that workers at a factory in Honduras Mr. Lynn had inspected complained as recently as this April that managers screamed at them, administered pregnancy tests and sometimes did not pay them for working overtime.
Wal-Mart officials said the official that Mr. Lynn accused of corruption was no longer with the company and that the Central American office he headed has been closed.